Divestitures and Carve-outs
A winning strategy and experienced resources are essential for success.
Divesting or carving out a percentage of your organization's assets can accomplish a variety of goals — raise needed capital, increase management focus, realize untapped value, reduce debt, position the subsidiary for an eventual change in control and more.
The transaction has, however, many moving parts to manage and organizational effects that need to be considered, analyzed and weighed before you get to closing. A divestiture or carve-out is a complex transaction that typically takes months to complete once you have an interested party.
Strategy and experience count
Thorough preparation — including a carefully constructed strategy, rigorous due diligence and precise execution by experienced resources — will help get you to closing more quickly. Resources who know what financial and operating information are important to buyers and how the information should be presented.
Using our years of transaction experience, we'll help you avoid potential transaction pitfalls by:
- Preparing reports compliant with U.S. GAAP and SEC financial
standards — and, if you have an international buyer, reports that are International Financial Reporting Standards-compliant
- Identifying and developing support for adjustments and add-backs, providing a transparent, balanced and credible view of the business aimed at maximizing value
- Coordinating responses to buyer's questions and operating a data room
- Collaborating with you on tax structuring and post-sale tax planning to determine the most desirable deal structure and terms
- Determining an accurate valuation range for the divestiture/carve-out candidate
- Providing assistance to develop carve-out and stand-alone cost structures, focused on identifying and resolving business separation and transition issues
- Perform information technology and operations due diligence
- Assisting in developing and implementing a post-divestiture integration plan
- Developing the carve-out or divestiture separation playbook, including technology, HR, reporting, supply chain, etc.
- Managing and helping to execute the separation, when needed
Let RSM help you design a winning strategy for your transaction. Give us a call today.
Buyers must allow ample time and budget to deal with unplanned tasks and challenges that come with any technology-related separation project.
This briefing recaps the three-part video series, “Carve-out fundamentals.”
Defining the relationship between the corporation and the private equity buyer.
What happens after a carve-out is executed? Bringing a carve-out company to stand-alone status.
In this private equity video series, industry professionals discuss the challenges of separating a portion of a company from its parent.
Identifying carve-out opportunities and then executing transactions can be complex tasks.